Middleby-AGA talks leave market guessing

The cooking equipment market is watching with interest to see if talks between the Middleby Corporation and AGA Rangemaster result in the US catering equipment giant taking over the British brand.

Middleby is predominantly focused on commercial cooking appliances but two years ago it spent $380m (£240m) acquiring Viking Range as part of a strategic move to penetrate the high-end residential ranges market.

The possible acquisition of AGA, considered a British institution in terms of cooking suites for the home, is thought to be connected to that strategy and would give it a major presence in the UK domestic market.

Middleby said last week that it had begin “preliminary discussions” about a possible cash offer for the AGA Rangemaster Group, while AGA said further announcements on the situation would be made in due course. In the meantime, it reiterated that nothing was set in stone.

“Middleby has not announced a firm intention to make an offer for AGA and there can be no certainty that Middleby will proceed to make an offer for AGA,” it states.

It is understood that Stock Exchange rules require Middleby to make any bid by July 15. Reports suggest the business, which is based in Leamington Spa, could be worth between £90m and £100m. Its share price shot up by more than 30% after news of the talks broke last week.

AGA Rangemaster’s primary production facilities are in the UK although it also has operations in Michigan, USA. The group employs just under 2,500 people worldwide. Rangemaster sales grew by 9% in the UK and by 6% overall last year as the company racked up sales of £261m.